WARTA ANDALAS, BANGKOK - 16 December 2013,
PTT Global Chemical Public Company Limited (PTTGC) and PT Pertamina (Persero)
signed Marketing and Trading-Joint Venture Agreements (Marketing & Trading
JVA) to establish a joint venture company in Indonesia. The JV Company is
targeted to seize the Indonesian domestic petrochemical market prior to the
plan of world scale petrochemical complex development that expected to start
its operation in 2018.

Apart from the recent signing of
Manufacturing Joint Venture–Heads of Agreement in December 10th, 2013, in
Jakarta, PTTGC, the Thai leading Petrochemical producer and Pertamina, the
Indonesian national energy company, have also advanced its partnership by
signing the Marketing and Trading JVA for merging and expanding their polymer
sales and distribution in Indonesia’s market. The JVA will enable an
establishment of joint venture company to serve a huge number of customers and
to better accessing the market, prior to the incorporation of developing the
petrochemical complex in Indonesia. The joint venture agreement has already
been signed and is subject to further regulatory approvals for the joint
venture company incorporation within the first quarter of next year.

Bowon Vongsinudom, President and CEO of
PTTGC, stated, “Today’s signing marks another significant step forward for
PTTGC’s and Pertamina’s commitment to strenghten our partnership for
petrochemical business development in Indonesia. I’m truly delighted to see
these progresses that we have made, and most impressed with this line-up of
activities which no doubt will energize and vitalize the partnership between
PTTGC and Pertamina. The partnership could build a venture that is well
positioned in creating value for every end, especially for the Indonesian
customers. The joint venture company business plan has been derived from the
intensive market survey conducted jointly in the earlier stage.”

“Following the HOA signing last April for the
potential collaboration, PTTGC has supported Pertamina with our polymer product
to conduct their sales and marketing activities in Indonesia. We also shared
with Pertamina our market and products knowledge, in order to scale up
Pertamina's advancement on petrochemical business. On top of the gradually
increasing volume of material supply from PTTGC, the joint venture company will
also market Pertamina’s polypropylene, produced in Plaju facility, fulfilling
domestic needs and ramping up its foothold in this promising market.” Said
BowonVongsinudom.

As mentioned earlier, Indonesia’s Domestic
demand for petrochemical products is expected to increase, due to the positive
trend of manufacturing sector. Indonesian petrochemical market value is
expected to reach US$ 30 billion in 2025 and with this partnership, Joint
Venture Company is targeting to control 30% of market share after the
Petrochemical Complex commercially operate in 2018. Currently, the production
of petrochemical in Indonesia is still insufficient to meet the downstream
industry needs, creating large import to the amount of US$ 5 billion per
year.

HanungBudya, Marketing & Trading Director
of Pertamina, stated, “As I said earlier this year in the HOA signing ceremony
last April, Indonesia has the best business potential for petrochemical product
marketing in this region, the size of the unmet demand, supplied by imported
products at the amount of US$5 billion per year and it’s time for us to grab
this opportunity. Here we come to materialize what we aimed for. The
establishment of this marketing and trading joint venture company is definitely
my pride and clearly in line with Pertamina’s strategy in growing the
downstream business, especially for petrochemical."

“Having PTTGC on board, as a strategic
partner, we believe that they could share its strong experience in the
business. Today, I can confirm that PTTGC is truly the respectable and trustful
partner. The joint project team has been working hard to meet the aggressive
timeline. As a result, the cooperation between the two parties has made another
key milestone of achievement.” added HanungBudya. (rel)